News

June 02, 2015

A new report entitled "New Markets for Pollution and Energy Efficiency: Credit Trading under Automobile Greenhouse Gas and Fuel Economy Standards" examines the prospects and implications for credit trading under the new CAFE and GHG rules. In the report, the authors, Virginia McConnell and Benjamin Leard of Resources for the Future, evaluate the current functionality of the CAFE and GHG credit markets and assess the potential for there to exist well-functioning markets in the future.

Based on their research, the authors make the finding that the trading of credits has been somewhat limited to date for a number of reasons, such as a lack of price transparency and the fact that CAFE and GHG standards, though increasing in stringency, still do not result in noncompliant fleets for most automakers. The authors predict, however, that as the standards become increasingly more stringent, and as manufacturers begin to utilize more efficient and transparent trading processes (such as the auction platform operated by Mobilis), CAFE and GHG credit markets will likely become more robust in time and help drive costs of compliance down for manufacturers

October 10, 2014

On October 8, 2014, Environment Canada published its final 2017-2025 MY GHG rules in the Canada Gazette Part II. For a copy of the notice, click here.

Consistent with the GHG and fuel consumption rules in the U.S., the Canadian GHG rule includes an emission credit trading program that provides companies with the option to obtain credits in model years in which they perform better than the prescribed stan­dards and use them to offset deficits in model years in which they do not achieve the prescribed standards. Companies may obtain these credits based on their own performance or they may obtain them through transactions with other companies with an available credit surplus.

As is already the case for CAFE, GHG and ZEV and other credit program, Mobilis provides manufacturers an efficient mechanism for trading GHG credits so to ensure compliance with the Canadian GHG standards. If you have questions about the new Canadian requirements or about Mobilis Trading, please give us a call at (202) 567-2926 or send an email to dale.kardos@mobilistrading.com.

July 13, 2014

On Monday (July 14, 2014), the California Air Resources Board (CARB) will hold workshop at 10 am PST in Sacramento to discuss changes that are being considered for the ZEV program.

According to the Staff presentation that was released Friday, the workshop will focus on amendments that would make the percent of sales requirement for Intermediate Volume Manufacturers (IVMs) more consistent with the percent of sales requirement applicable to Large Volume Manufacturers (LVMs). IVMs include manufacturers like JLR, Mazda, Mitsubishi, Subaru and Volvo. If adopted, the percent of sales requirement for IVMs would, according to projections by CARB, change from 44% in 2025 to 18.4% in 2025 (assuming IVMs use TZEVs to comply).

At the workshop, CARB also intends to discuss changes that would reduce the compliance burden for IVMs that want the flexibility to pool compliance in ZEV states and to earn a reduced TZEV requirement. Currently, to have this flexibility, IVMs must deliver ZEVs to S.177 states prior to 2018, however, under the modifications being considered by CARB, IVMs would get an extra two years to comply with this requirement.

CARB will discuss the fast refueling and clarifying language related to that provision.

The schedule for finalizing the modifications that will be discussed at the workshop calls for the proposed amendments to be issued for public comment in early September and a Board Hearing in late October.

In a Forward Auction, a company with excess credits initiates an auction to sell credits and companies needing credits bid to buy them. As the auction proceeds, bidding drives up the price of the credits. When the auction ends, the company that has offered to pay the most for the credits is the winner.

In a Reverse Auction, a company needing credits initiates an auction to purchase credits and companies with excess credits bid to sell their credits to that company. As the auction proceeds, bidding drives the price of the credits down. When the auction ends, the company that has offered to sell their credits for the least amount of money is the winner.